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Waste removal company sued customer for breach of contract. Customer had signed a 3 year contract that automatically renewed for 3 years. Customer moved for summary judgment to dismiss the complaint on the ground that the contract was unconscionable. Sound familiar? We get that defense to alarm collection cases all the time. In this case the judge denied the motion, holding that the complaint sufficiently stated a cause of action for breach of contract. The court did note that Connecticut did have a statute that affected automatic renewal in waste removal contracts. You can read the case here https://www.kirschenbaumesq.com/article/pdf/002242-ct-2012-conn-super-lexis-1575.pdf
Connecticut also has a statute that affects alarm contract automatic renewal provisions. You can read the law here:
https://www.kirschenbaumesq.com/article/automatic-renewal-no-changes-required
You can avoid complying with the law by using a month to month renewal provision. The Standard Form Contracts for consumer use generally have a 5 year term and renew automatically month to month. I have written extensively why I think month to month is the better automatic renewal term, and that 5 years is acceptable for a consumer contract.
I am questioned often about the term length. Some alarm owners think the term should be shorter. Three or even one year terms. Today I had an alarm company owner want month to month for the start. There is no magic number for the initial term. Each business owner believes he has stumbled upon or arrived at the right solution after much consideration. I suppose that different types of systems and services, offered to different types of subscribers in different types of environments may call for differences in marketing strategy which includes initial term length. However, I can state with some confidence that 1) the vast majority of subscribers do not read the contracts or request changes, especially in the initial term, 2) a contract with a longer initial term is worth more than a contract with a lesser term, and 3) an alarm company operating in a state with an automatic renewal statute [check your state here https://www.kirschenbaumesq.com/page/alarm-law-issues] that doesn't comply with the statutory provision on automatic renewal is de-valuing the company's valuation; the multiple on the RMR calculation is going to be less than if there was compliance. What's your company worth? Check it out here https://www.kirschenbaumesq.com/page/what-is-my-alarm-company-worth
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